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Ups Case

In: Business and Management

Submitted By tausarpao
Words 280
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The purpose of this memo is provide a recommendation on whether to invest in FedEx or UPS, given that the air transportation market in China is now open to both companies. Outlined in this memo are an assessment of the strategic approaches and an evaluation of the financial and non-financial performance of both companies, which led to the conclusion that UPS is the superior investment opportunity.
1.0 Strategic Approaches for FedEx and UPS FedEx and UPS are package-delivery companies that together provide supply chain, transportation, logistics and related information services. FedEx has expanded from operating in 25 U.S. cities, to serving international markets. Similarly, UPS initially operated just within the U.S. before expanding into Canada, Europe, Latin America and most recently, China. FedEx and UPS target the same markets and compete for presence in them.
FedEx and UPS have some key differences with regards to their strategic approach to business (see Table 1). FedEx, which is regarded as an innovative, entrepreneurial, and operational leader has a strategy that focuses on providing high quality services to its customers. FedEx’s technological innovations, including the COSMOS interface, enables it to provide timely delivery service to its customers and large clients.
UPS has a strategy that is driven by its quest for efficiency and cost reduction. In the past, UPS was regarded as “financially and operationally conservative” due to its reserved approach to investing in information technology. It was considered an industry follower, as it did not come up with unique processes to distinguish itself from its competitors. Since its IPO in 1999, UPS has made efforts to change its image through aggressive information technology investments and…...

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